TESLA TO GO PRIVATE & SHORT SELLING IRONY

Page may contain affiliate links. Please see terms for details.
Chris,

It's not that it's unpopular or popular, it's that it's wrong IMO.

The people who mostly bitch about shorters are naive retail investors who have been suckered into a share promotion or a pump & dump & have been left holding the baby. Despite regulators requiring short positions above 0.5% to be declared daily Notification and disclosure of net short positions you regularly see people on the financial BBS claiming shorters are destroying / manipulating / controlling the share price of 'their' company (when it's not the market makers up to their dastardly deeds) when there is no evidence of any short position at all. More likely it is the pumpers getting out in volume that're responsible for the price drop, leaving the mugs to hold spiked shares. In bigger companies, FTSE companies, shorters have spotted an issue that they believe will result in a lower share price, or possibly, the demise of the company. Carillion was shorted big time before it collapsed. The shorters knew the writing was on the wall while the co., their advisors, their accountants & mgmt. consultants continued to advise everybody all was tickety boo. Shareholders were wiped out to the tune of £Billions.

Shorting is dangerous, with big rewards & bigger penalties if you get it wrong. IME shorters do better research & know what they're talking about. They have to, or they'll be mortally wounded.

The top 10 shorted shares in London - Short Interest Tracker - Companies . Some huge companies & household names on that list. See where these companies are in 6 months.
 
Last edited:
I've owned two financial services tech businesses - one in the retail and sole trader space, sold to a US finance house (I part owned my own CC business for a while). And another in the DCM space, sold to a consortium including Citi, what was Merrill and Microsoft. And I can tell you from first hand experience, it's a very tough market to be in. Yes fortunes are made, but the vast majority working in that space are just normal hardworking folks. Trying to make a living, albeit in a sector which has an expectation of continued over performance, which in reality means long hours and an assumed dog eats dog attitude.

But I agree it gets the bad press it sometimes deserves. Some of the ar5eholes I've met and in some cases have had to work with, make your skin crawl. Take a look at the Predator's Ball for some junk insight, or Micheal Lewis' infamous Liar's Poker. An insight into the goings on in the corrupt securitised mortgage market, long before the 2008 crisis.

But it's not all bad. Some finance verticals are near essential, futures as mentioned, default swaps, insurance, currency trading, etc, and on a larger scale, without DCM, many firms wouldn't be able to invest in expansion or new ideas. And on a smaller scale, without trade insurance, many smaller firms wouldn't be able to buy stock on account. And in the US, there's the Muni market (Municipal Bonds). These are income tax free (iirc) bonds offered to the general public for financing public build projects. Hoover damn being an example. Munis, which of course have had their problems, have been fabulously successful (c. $400bn annually) and one wonders why we don't see that type of project more often over here.
 
I agree with many if the points here but shorting will always be unpopular just like the ambulance chasers and the like.

In essence you are making money out of others people's misfortune. That in itself is not an issue, happens all the time & is part of life. The problem for me is these actions shape, force market prices & movements. It also massively accelerates a company's demise when they are having hard times. It normally seals their fate rather than giving a business time to turn their fortunes around.

Kind of kicking a man when they are down. No attempt to help just stick the boot in at the hardest/toughest point. Lots to be said for private ownership in that regard. Maybe some companies should think longer & harder about the seemingly default option to float with the seemingly massive additional burden's it can bring.
 
Reverse ferret from Elon Musk - Staying Public

I think Tesla is the short of the decade, problem is it's a religion to some 'investors' & Mug Buying Power (MBP) can overcome economic realities. "The market can remain irrational longer than you can remain solvent."
 
Reverse ferret from Elon Musk - Staying Public

I think Tesla is the short of the decade, problem is it's a religion to some 'investors' & Mug Buying Power (MBP) can overcome economic realities. "The market can remain irrational longer than you can remain solvent."
I'd agree with this. It should be the short of the century but fundamentals seem to mean nothing these days. Being rational, sense, profit, efficiencies seem to mean less than nothing. Who knows. I have given up try to second guess the markets, anyone or anything these days.

The only thing that makes sense these days is that nothing makes sense. How do you make sense of that?
 
The people who mostly bitch about shorters are naive retail investors who have been suckered into a share promotion or a pump & dump & have been left holding the baby.

It's typically a parasitic activity on the market - just like the high speed trading. The very act of having to borrow shares to short is a demonstration of its artificiality.

Shorting is dangerous, with big rewards & bigger penalties if you get it wrong. IME shorters do better research & know what they're talking about. They have to, or they'll be mortally wounded.

So well researched that they got tangled with VW even *after* the situation with VW ownership was well publicised.
 
I'm trying to figure out what problem is solved by selling stuff you don't have :dk:
 
Short selling is not meant to solve any problem... it is meant to create a problem that you can benefit from, because you have taken the opposite position in advance.
 
I guess just like betting has been revolutionised by being able to win by betting on the loser. Or so many other complex bets that you would have had to get a bookie to have done custom odds for years ago.
 
Short selling is not meant to solve any problem... it is meant to create a problem that you can benefit from, because you have taken the opposite position in advance.

It's not meant to create a problem.

It's just that it may create them.
 
Elon Musk royally screwed the pooch with his taking 'private, funding secured' tweet in August. Some believe he wanted to spank shorters. If that's the case his machinations have backfired very badly. He's being pursued for securities fraud by the SEC, who have moved with eyecatching speed here & risks losing control of Tesla, and possibly far worse.

Terms of Service Violation

Tesla's Elon Musk accused of fraud

TSLA lost 11% in after hours trading yesterday. It'll be interesting to see what TSLA opens at in NY this afty - Tesla, Inc. Common Stock (TSLA) Real-Time Stock Quote - NASDAQ.com Might be wrong but I think this is going to end in tears & shareholders are going to lose everything.
 
A couple of mins before the market opens & TSLA is at $270, down $37, -12%.

It's dropped $74 in the last 2 sessions.
 
Might be wrong but I think this is going to end in tears & shareholders are going to lose everything.
Arguably Tesla has been massively overvalued for some considerable time, so it could just be a healthy dose of reality kicking in that will see it lose the ludicrous premium that it’s been valued at.

An alternative view is that Ponzi schemes always do collapse in the end, leaving the investors with zilch.


Sent from my iPhone using Tapatalk
 
- Elon Musk announces he has secured the funding to buy back Tesla's shares from the public.

- Elon Musk is seen smoking pot in a live interview, causing Tesla's share prices to plummet.

Coincidence? ;)
 
After the bounce (dead cat?) on news of the SEC settlement & Musk stepping aside (yeah, right) the share price is now lower at $262.95.

Worse to come IMO.
 
http://www.qcmfunds.com/

Click on the 'Aphria' link & have a read. Still convinced the shorters are the villains in the market?
 

Users who are viewing this thread

Back
Top Bottom